Podcast: Lieberman's Cold Fusion?
Of all Ford's Bold Moves, the fact that the automaker continues to provide Jonny Lieberman with press cars is easily the most impressive. Despite Mr. Neundorf's take-no-prisoners Ford Death Watch, despite Mr. Mehta's ceaseless accusations of core model neglect, despite Mr. Lieberman's withering reviews of Ford products, the automaker seems perfectly willing to afford our West Coast wheelman major seat time in their latest offerings. JL reports that The Blue Oval Boys wanted him to sample his latest loan– a Fusion four-banger mit stick– 'cause it's the sportiest variant of their front wheel-drive mid-size sedan– not because it's the most unloved vehicle in their press fleet. [FYI: Plenty of pro car hacks can't drive a manual transmission.] That's OK with us (the loan part, not the fact that a car journalist can row his own boat). Many of TTAC's most popular reviews center on garden variety machines, rather than mortagage level luxury cars or expensive exotics. We look forward to reading Jonny's take on the "base" model's dynamic capabilities. Even when– I mean "if" Ford goes belly-up, we will remember this mitzvah, knowing that somewhere within that giant organization someone has their priorities straight. When all is said and done, that still counts for something.
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Forget about bailouts (for now), I'm more concerned about Detroit/Washington's ability to work out the soaring legacy costs of their workers, namely health care. That's a huge burden on everyone, and Detroit can put the issue front and center.
On the flip side of the currency issue, the yen was very weak 10 years ago, when the SUV craze was on the up-and-up. When the choice is a small car or big SUV, and gas prices were dirt, where do you think the market went? Luxury cars from Japan were going for huge amounts of money - I remember the sticker on the Acura 3.2TL (V6, as opposed to the 2.5 I-5) at $37k, and that my dad had to move down from the Legend to the TL to keep the same lease payment.
If the yen manipulation argument was really the big 2.5's main topic of discussion with the President, then that's pathetic. If true, it's a good illustration of just how out of touch these guys really are. When Honda and Toyota are building 70-80% of the car they sell in the US, the currency argument holds very little water. Also, if GM is doing so well in China then maybe they should turn themselves into the Wal-Mart of cars and shift most of their manufacturing over there. After all, if they can't beat H&T at their own game then take a cue for the retail business and lowball them.
The "big 2.5" do indeed have some legitimate issues with fundamental currency disparities vis-a-vis Japan, much like we as an entire nation have competitive issues with China vis-a-vis the Yuan rate. Of course it is not the only reason they are in trouble, but it certainly is contributory unlike your dismissal of it. When Honda cuts back on East Liberty, Ohio Civic production and moves it back to Japan for export, what does that tell you? Sure they need to adjust faster to the world and make far better and a larger small car market share. They were caught offguard needlessly with a poor product mix to respond to the fuel crisis of 2005-2006 that was predictable for years and years, but not all of their trouble is self induced, just a large portion of it. Problems like currency manipulation exaggerate the effects of other issues of mismanagment, but makes them no less valid.